If 2003 was the year the market awakened to supply chain-based RFID, 2004 will surely be the year it readies for school. The two mandates for 2005, set by Wal-Mart and the U.S. Department of Defense (DoD), pushed RFID into the public eye and moved it from company science experiment to boardroom priority, with a focus on improving enterprise-wide operations. Now, manufacturers, the suppliers to Wal-Mart and the DoD, are diving into an increasingly busy RFID market already brimming with developing standards, large company entrants, start-up software developers, and numerous systems integrators. Despite some recognizable large company names, success is still to be determined, says technology research firm ABI.

Texas Instruments, Symbol Technologies, NCR, Philips and Sun Microsystems are only some of the big-name companies that have entered the world of RFID. Some recognizable names have entered the RFID fray as systems integrators, namely IBM, Accenture, BearingPoint, Unisys, RedPrairie and Manhattan Associates. Process questions abound, such as where to store the data, what data should be stored, how to secure and maintain data, and what is the optimal method to integrate data with existing business solutions. Some integrators, such as SAP, are developing enterprise-level RFID patches for customers. There are others, known as warehouse management systems companies, which include Manhattan Associates, RedPrairie and Provia. Long-time DoD integration partners such as Unisys, Lockheed Martin and Accenture are stepping up government-based RFID efforts.

“Due to the time constraints and the still-developing standards, prior relationships will drive RFID integration contracts even more than with previous rollouts, such as ERP or supply chain management systems,” notes Erik Michielsen, ABI senior analyst. “This is not necessarily good for the RFID business, because the process discourages competition and rewards relationships over capabilities. The upside is that established relationships will better enable scalable, successful solutions due to better understanding of environment, staff and business goals.”

Another complex issue is that RFID is new, and there have been few full-scale projects to date, especially for supply chain solutions. While integrators such as SCS, Unisys or Lockheed Martin have extensive, long-term relations with the DoD, they do not have extensive experience with passive, UHF RFID tags. The leading supplier lists for Wal-Mart and the DoD are long, and integration solutions must conform more than differentiate if these projects are going to roll out to specification and on time.

ABI's report, “RFID: Emerging Applications Driving R&D Investment and End-User Demand,” follows the technology for applications including asset management, supply chain management and point-of-sale. The study breaks down RFID standards, applications and vertical markets and provides marketplace forecasts through 2008. Reader shipments and revenue are provided, as well as data on different RFID transponder and component markets. In addition, selected RFID vendors, integrators, developers and IC manufacturers are analyzed, along with their various technologies and product offerings.

Additional information on the RFID landscape can be found in an upcoming report from ABI entitled, “RFID Vendor Assessment: Analysis of Major Players' Strategies, Positioning and Technologies.” This study examines the leading RFID companies and their ability to provide solutions that are required for Wal-Mart's RFID mandate.